The market for green bonds has passed €300 billion and it is growing rapidly, according to NN Investment Partners (NN IP).
NN IP said it has seen its green bond portfolio grow from €20 million in 2016 to around €900 million in July 2018. The manager said that its Euro green bond fund has been the world’s best performing fund in recent years and has reached €560 million in assets under management, making it the world’s largest green bond fund. NN IP attributed the rapid growth of green bonds to increasing demand from investors for sustainable and environmentally friendly investments, without giving up returns. NN IP said it has a particular focus on ‘dark green bonds’ since 2014, by assessing green bonds itself. It also provides impact reporting to clients, showing the effect of green bonds on issues such as CO2 emissions. The point of green bonds is to provide fixed income instruments that will help finance new or existing projects which are beneficial to the environment.
NN IP lead portfolio manager, green bonds, Bram Bos, commented: “Our clients indicate that green bonds play an increasingly prominent role in portfolios and welcome the rapid growth of the green bond market. Issuers recognise our strong position in green bonds. This allows us to influence new green bond placements and owing to our size, we are a welcome participant in new green bonds issues.”